Yutang Sports Note:
According to our past understanding, carbonated drinks are more in line with consumers in the sports field because the target group tends to be younger. However, as people pay more and more attention to health, the sales of bottled water have gradually increased.
Bottled water sales exceed carbonated drinks
According to a report by research and consulting firm Beverage Marketing Corp. (BMC), Americans consumed 12.8 billion gallons of bottled water in 2016 , an increase of nearly 9% from 2015 and approximately 12.8 billion gallons of bottled water . Consumption of soft drinks exceeds 400 million gallons. The report also predicts that sales of bottled water will continue to increase in the next few years, while sales of carbonated drinks are declining at an annual rate of 1% to 2%.
This aspect shows that Americans are beginning to pay more attention to dietary health. On the other hand, we also ask, in the sports marketing market that Pepsi and Coca-Cola have controlled for more than 100 years, what changes will this situation bring?
At many sports venues, sales of bottled water once outsold soda, especially calorie-rich soda. However, in professional stadiums, bottled water logos appear far less frequently than carbonated drinks. Traditional media platforms also show the same trend: soft drink brands tend to spend a lot of money on marketing, and even if the bottled water market is on the rise, bottled water brands are often more willing to spend their budgets on supply chain, distribution and packaging operations. superior.
What’s more, even if the sales of bottled water exceed that of carbonated drinks, the corresponding sports marketing expenditures of brand owners will not increase accordingly. The difference between bottled water and carbonated drinks is like the difference between Aquafina (a bottled water owned by PepsiCo) and Pepsi . Some insiders believe that the main reason for the difference is profit, which is an area where bottled water brands do not have an advantage.
"Bottled water's profit performance has improved, but it is still minimal compared to soft drinks." Bob Reiff, then chief marketing officer of the NFL Los Angeles Rams , said. Five years ago, he brokered a partnership between bottled water brand Dejà Blue and the Rams.
Profit has become the main factor affecting the sports marketing of water companies.
Another reason is that from a historical perspective, bottled water merchants do not pay as much attention to brand as carbonated drink companies. “Brand is an important factor affecting the sales of carbonated drinks, so Coca-Cola and PepsiCo have to spend huge investments in marketing,” said Gary Hemphill, general manager of research at BMC. “The most important purchasing factor for bottled water is obviously price. "
Hemphill's research also found that compared to their dominant position in the soft drink market, Coca-Cola's water brand Dasani and PepsiCo's Aquafina are still far behind. According to 2016 data, high-end water brands Niagara and Nestlé Premium Life accounted for 47% of the market share, while Dasani and Aquafina's combined share was less than 15%. In the past ten years, compared with the price increase of soda water, the price of bottled water has also shown a downward trend, which has also discouraged its brand owners from sports marketing.
Of course, for many big brands, bottled water is still an important part of their product system. "Coca-Cola insists on adding bottled water to the beverage sponsorship agreement. We sell a lot of it in the stadium, but they don't promote it," said a marketer for an MLB team on the East Coast of the United States.
"Bottled water outsells soft drinks in many venues. But to be on the safe side, we want to retain the ability to sell a variety of products in the venues - whether it's bottled water or soft drinks," said John Cordo, director of sports trading management at Coca-Cola "(Bottled water brand) Smart Water has Tom Brady as a brand ambassador, but I don't know of any other brand that has a promotion strategy for sports properties. The marketing strategy is usually for soft drinks, promoting bottled water," Watts said. It’s just part of the brand strategy.”
Since 2007, Coca-Cola has launched a comprehensive cooperation with the famous American venue operator AEG for 20 venues.Russell Sievers, vice president of global partnerships at AEG, believes that soft drinks’ spending advantage in sports marketing will continue to be maintained. "This has been the case since the advent of sports marketing and both the big drinks companies and consumers are used to it," he said.
However, this situation can also be changed. With the help of sports events that require a lot of water replenishment, such as AEG's Tour de California cycling race, Dasani's sales performance has been outstanding.
The direction of sports marketing for bottled water
Randy Bernstein of Premier Partnerships in Santa Monica, Calif., recalls that a few years ago they did a Rose Bowl selling Fiji Water in bars and suites. brand bottled water, Arrowhead brand bottled water is sold at lower fare locations. “Both Coca-Cola and PepsiCo hope to maintain the status quo of comprehensive cooperation, so it is interesting to see whether bottled water can become a separate sponsored category,” he said.
Generally speaking, focusing on sports marketing can highlight the high-end positioning of water brands. For example, Evian Mineral Water sponsors a PGA Tour event and Wimbledon, and has maintained a cooperative relationship with the US Open Tennis Open for more than thirty years.
“The bottled water market has matured and is segmented into mass market and premium markets,” said Deany Bonnar, general manager of cooperative marketing for the USTA. “The U.S. Open can create momentum for premium water brands because we are committed to The target is a group of active people who love health, which is the target consumer of brand owners. "
As the market share of bottled water increases, some copyright owners begin to regard bottled water as a separate category. For example, although MLB the New York Yankees and Boston Red Sox signed contracts with Pepsi-Cola and Coca-Cola respectively, they also chose Nestlé Poland Spring bottled water as a sponsor. "More and more teams are carving out this category," said one senior NBA team executive, "so you have to be careful with partnerships with big brands."
Other teams have found it too New methods. For example, through more than 60 years of sponsorship cooperation with Kroger, the MLB Cincinnati Reds have launched exclusive branded bottled water, French fries, peanuts, burritos, hot dogs and other products at their home stadium. For another example, the St. Louis Cardinals, who had previously signed a contract with Nestlé Ice Mountain bottled water, finally chose to cooperate with dairy supplier Prairie Farms to sell exclusive brand water in venues, stores and outlets, and through official radio, television and venues. Publicity boards for promotion.
Conclusion
As the sales of bottled water increase year by year, the competition between brands has become more and more fierce. Faced with such a market, in addition to relying on brand positioning to highlight differences, brand owners can also actively participate in sports marketing. Through sponsorship of large-scale events, clubs, and leagues, they can not only directly promote the growth of bottled water sales, but also directly promote the growth of bottled water sales. Capture a group of active consumer groups in the first time.
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